Brexit and bike insurance: Industry Reaction
On Thursday 23 June, the UK public will head to the polling stations to decide whether we stay in the EU.
It’s one of the biggest referendums in UK history and the lengthy campaigning period is emblematic of just how important the vote is.
For well over two months the vote has never been too far away from front pages, lead items on the news and it’s taking over Social Media too.
If you’re anything like The Bike Insurer, you’re probably getting a little frustrated with all the coverage.
Not because it’s ruining your Facebook News Feed, but because there’s an absolute dearth of clarity.
The bad news
Unfortunately, we can’t offer you much in the way of facts either. Instead, we’ve gathered information and views from the industry about the impact a Brexit vote would have on UK bike insurance.
British Insurance Brokers’ Association (BIBA)
BIBA has spoken out in favour of remaining in Europe.
Lord Hunt of Wirral, BIBA Chairman, said: “A ‘remain’ vote would stimulate investment and boost confidence that we will be able to continue to trade freely under the EU freedom of services provision.
“That, in turn, would benefit both us within the sector and also our customers.”
As well as Lord Hunt’s comments, BIBA has offered up a few different reasons why leaving the EU would be bad for insurance, including:
BIBA says leaving the EU would lead to uncertainty about UK businesses as well as leaving having an adverse impact on investment and the insurance market overall.
Brexit would result in less insurance companies from outside the UK ‘passporting’ into our market, leading to a reduction in competition and choice for customers.
Passporting is where a company applies for a ‘passport’ to trade in a different country to their own in another European Economic Area (EEA) State.
Association of British Insurers (ABI)
The ABI agrees with BIBA, stating that the UK is better off remaining in Europe when it comes to insurance.
Huw Evans, ABI Director General, said: “The UK economy benefits from membership of the EU single market and being part of the world’s largest trading block.
“Membership guarantees the right to do business in 27 other countries on an equal footing. The UK gains from this arrangement; we sell more in insurance & long-term savings products to the rest of the EU than they sell to us.”
One of the major points that ABI makes is that red tape will not disappear if we leave the EU, one of the pro-Brexit arguments, stating:
“It is highly unlikely that the Prudential Regulation Authority (PRA) or Financial Conduct Authority (FCA) will start to withdraw any legislation that originated in the EU.”
Motorcycle Industry Association (MCIA)
The MCIA has positioned itself slightly more on the fence after releasing the following statement after questioning its members:
“MCIA surveyed its members late in 2015 and overwhelmingly those who responded wanted to stay within the EU on the proviso that any renegotiation of terms thereafter provided the means to challenge what appears to be the worst excesses of proposed regulation.
“Notwithstanding MCIA will be ready to advise its members whatever the referendum outcome albeit that change from either outcome will be sometime in the future.”
Industry reaction – summed up
As you can see, the opinion from within the insurance industry seems to lie with remaining in the EU.
However, like most arguments for and against Brexit, those within the industry are again based more on predictions than hard facts.
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